What does Deemed Interest mean?

3 Answers

Stuart

0

Deemed interest is an adjustment entry used for tax purposes. This kind of interest is considered to have been received even if it was not.

For example if a member of a multinational corporation receives an interest-free loan from an affiliated company, the tax authorities in the lender's country may adjust the lender's profits by adding an amount equal to the interest which would have been payable on the loan.